Whether you are moving out of your parent’s place, leaving student housing, or just moving out on your own for the first time - learning how to budget before you sign the lease is key.

One of the biggest mistakes people have when it comes to renting is not thinking about how much they currently make and the expenses they have month to month. When those aren't factored in along with any trips you are planning on taking in the future you could end up choosing the wrong apartment. While the apartment may technically be in your budget, it could make doing extra activities and trips a no-go. 

That’s why it’s important to know how much you currently make and what your average monthly expenses are. If you don’t know those numbers, start keeping track with an excel spreadsheet or by keeping all your receipts!

To help you budget for your first apartment, we found the article below that helps to break down all the reasons budgeting is important and how much you should be spending on rent based on your income. It’s also full of basic renting expenses you should be expecting when you move into an apartment and ways to help you save money in the long run!

How to Budget for Your First Apartment Rental

Posted by Lemonade.com

Why you should budget in the first place

Moving into your first apartment means a lot in terms of independence as well as responsibility, especially financial responsibility.

Signing an apartment you can’t afford is risky, but it’s more common than you think: A recent study at Harvard showed that 1 in 4 people are paying more than 50% of their income on rent and utilities. That’s a heck of a lot.

Plus, the cost of living is increasing at its fastest rate since 2008 while wages are remaining stagnant.

The takeaway? Your salary is unlikely to keep up with the increasing cost of rent. Which is why properly creating a first apartment budget is so important.

Calculating exactly how much you can spend on rent will allow you to begin saving money for your financial goals instead of living paycheck-to-paycheck.

How much you should spend on rent?

The big question surrounding apartment expenses is: How much of your income should you spend on rent?

Ask a traditional financial advisor, and they’ll probably tell you that 30% of your gross income is how much you should spend (gross income is the amount of money you make before deductions like state and federal taxes).

And they’re not the only ones. A quick Google search will reveal a long list of sources telling you to only put down between 25% to 30% of your income on rent. Enter the 30% rule.

[continue reading about how much you should spend on rent]

What other rental costs you need to consider 

The bulk of your living expenses will come from your monthly rent check, but there are a handful of additional expenses to consider when creating a budget for your first apartment. It’s important to know what to ask when renting an apartment.

One-time fees vs. Recurring expenses, aka the stuff you’ll have to pay on the reg

 [continue reading about one-time fees and recurring expenses!]

How to save more money

Any business owner can tell you cutting expenses can have a significant impact on the company’s bottom line. Your bank account is no different; think of your account as its own business entity with an income stream (your salary) and expenses (utilities, rent, food, etc.) that need to be paid.

You can increase the amount of dough left in your account at the end of the month by cutting back and reducing those expenses. Here are some places where you can easily pinch a penny:

[Continue reading entire article for more tips on how to save money and how to budget your income and expenses!]

Other Things to Consider When Renting an Apartment 

When you're on the lookout for renting an apartment there are a few things you'll want to keep in mind, especially if you've never rented one before! 

When you've found an apartment you are interested in, make sure you can see photos online and then call to schedule a walk through! There are things you'll want to pay attention to during a walk-through, which will help you determine if the place is right for you!

When you've found the apartment that you like, make sure you ask all the questions about the moving, parking, leasing and more! You can never ask too many questions, especially before you sign your lease. 

Lastly, here is what you should look for within the apartment lease itself! It's important that you actually read your lease so you know what you are agreeing too.